BRASIL: "Doctor Doom" Warns Bubble Trouble Ahead.

MERCO PRESS/ Economist and professor Nouriel Roubini, aka "Doctor Doom," who predicted the global financial crisis believes Brasil's, China's and India's economies may be overheating and developing asset bubbles. “In Brazil, like in many other emerging market economies, there is now evidence of overheating of the economy,” he said. “Expected and actual inflation is starting to rise, and that implies that over the next few quarters there has to be a tightening of monetary policy, gradually but progressively, in order to make sure that inflation expectations remain anchored.” Roubini wants Brasil to limit the appreciation of the Real, including the “judicious” use of capital controls. The currency has gained 8.2% against the dollar over the past 12 months.

BRASIL: Petrobras May Delay Stock Offering; Real Sinks To 19 Month Low.

BLOOMBERG/     Petrobras CEO Jose Sergio Gabrielli may consider a delay selling as much as $25 billion in shares if global equity markets worsen. Petrobras has dropped 15% this month to the lowest level since March 2009. The biggest share sale in the Western Hemisphere in at least a decade had been planned for late July or early August.
There is more bad news for Brasil as its real fell for a sixth day to $1.895, the longest losing streak in 19 months, on speculation that falling commodities will lower exports. And the nation's Bovespa stock index  fell for a sixth day to 58,706.18, its longest losing streaks since October 2008.

Brasil's Bovespa/Real Shrug Off New Tax And Advance.

BLOOMBERG/
“The strong fundamentals for Brasil have not changed,” said Leonardo Kestelman of Dinosaur Securities. Brasil’s 8.75 percent benchmark interest rate means that its fixed-income securities still offer a “premium” over that of developed countries, he said.

Reaction To Brasil's New 2% Tax On Foreign Capital Inflow; Stocks, Real Drop.

WSJ ONLINE Link/ BLOOMBERG Update/
Brasil's 2% tax starting today on all foreign investors for Real-denominated, fixed-income securities and stock purchases “to avoid an excess speculation in the stock market and in capital markets" brought swift market reaction.
Brasil's stocks dropped the most in four months and the Real tumbled. The Bovespa exchange plunged 11 percent on fears the tax will curb trading. Petrobras and Vale, the most heavily weighted stocks on the index, retreated more than 3.3 percent.
“Unfortunately this is going to raise in some people’s mind that Brasil remains a risky place to do business,” said Christopher Palmer of Gartmore Investment. “How many countries in the world are proposing capital control?”

Is Brasil's Real Overvalued?

From Bloomberg.

One expert says the real should trade between 2.30 and 2.40 per dollar to boost exports without increasing imports.

JP Morgan Sees Stronger Brasilian Real... At 1.8 Level.

From Bloomberg.

Brasil's Real Surges On Belief Recession Is Over.

From MercoPress.

The real hits $1.9262 per $USD.